After less than satisfactory ventures in India and the USA, medtech company dedicated to respiratory health Respiri (ASX: RSH) is heading to the Philippines. The Company will establish a Company Centre of Digital Innovation Excellence, which will aim to drive digital product innovation to cater to American market opportunities, improve productivity and increase return on investment.

This initiative is expected to reduce Respiri’s IT costs by $700,000 per annum and increase productivity by about 30%. The Philippines’ employment market is brimming with tier 1 software engineering resources, which are highly skilled and more affordable than others. This gives Respiri plenty of access to useful resources. As part of the initiative, the Company’s Australian-based IT human resources will be eligible for R&D tax credits.

In the initial phase, the Company opted for an Employer of Record business model in the Philippines, with support from local partner Yempo Solutions, to get employees on board. In September 2022, Respiri finished hiring the first bunch of new staff, totaling eight employees. These resources complement Respiri’s existing Customer Service function which had been established via the same business model in late 2021. 

Respiri CEO, Marjan Mikel, commented, “We are taking strategic steps in bringing critical capabilities inhouse and establishing core competencies that are central to Respiri’s business model. The newly established Centre of Excellence will accelerate our digital design and development capabilities and allow further improvements in productivity and efficiency through its low-cost location.”

Mikel acknowledges that the Philippines is allowing them to tap into a very capable talent pool to meet customer requirements. The Philippines expansion follows an internal review of strategic competences required to support Respiri’s global growth ambitions, which it previously tried to achieve by setting up shop in India and USA. 

To do so, the Company believes that it must prioritise in house key tech competencies and processes, with special attention to research and development. In fact, it started operating an in-house processing structure in September 2022. Its growth agenda also entails partnering with technology vendors and service providers to drive cost reductions and increase productivity. Resources will focus on mobile and web apps, web portals, SaaS, Machine Learning, system integration and API, as well as full platform and IT ecosystem solutions. 

As these resources are in the same time zone as key local product development resources, the Company is able to create a collaborative work environment. The Centre of Excellence will undertake the design and development of software underpinning digital products and technology solutions. 

Through this initiative, Respiri aims to reduce its cash burn and increase development capacity. This way, it will be able to make the most of market opportunities unlike before. Respiri seems to be extremely committed to gaining ground in the USA. Besides this initiative, on September 21, 2022, the Company completed a placement of $1.6 million to sophisticated investors with management providing $100,000 to support the Company’s growth in America.

Respiri CTO George Vlachodimitropoulos concluded, “To support the USA market strategy Respiri has recast the technology operating model to support revenue growth opportunities, develop market aligned products in a more collaborative manner, gain productivity improvements and improve cost structures.”